Will new council kill streetcar if cost is similar to finishing?

The cost to cancel Cincinnati's streetcar is nearly as much as to finish it, project executive John Deatrick told the City Council on Thursday.

Deatrick and city budget director Lea Eriksen outlined the costs of cancellation to a special meeting of council’s Budget and Finance Committee. In remarks after the meeting, the three new, incoming council members, who will decide the streetcar’s fate, pledged to study the numbers and meet with Deatrick.

None were immediately persuaded to change their minds about pausing the project, an action that will actually result in the streetcar's demise, according to city officials.

The cancellation costs total between $108.4 million and $125.4 million while the project’s estimated cost is $133 million.

The costs would include:

$32.8 million spent so far, which will not be returned

$30.6 million to $47.6 million to close down the project

$45 million in lost federal funds

"For $8 million difference, you get a project. You get a streetcar," Eriksen said.

"Those look like huge numbers, and they are," Deatrick said of the $14 million to $20 million alone in construction closedown costs.

The estimated cancellation costs do not include the cost of potential lawsuits by the contractors building the streetcars and the streetcar line, maintenance facility and stations. They assume that the city will be able to negotiate closeout costs without litigation.

If lawsuits are filed, Deatrick said, "All bets are off."

Pausing the project in an attempt to stop spending money on it while council assesses its state really means canceling it, Deatrick said. Councilman P.G. Sittenfeld and incoming council members David Mann and Kevin Flynn have endorsed that approach.

To pause the project requires a change order with the federal government, one that federal officials have told the city they will not approve because backing up the schedule means increasing the costs. If the work stops, the federal government will expect repayment of the $4 million for which the city will have billed it within 30 days, Deatrick said.

Flynn, Murray and Mann all said after the meeting that they still plan to vote to pause the project.

"I would be willing to pause it because I don't believe what they said. That's absolutely a falsehood," Flynn said, referring to the idea that a pause really means cancellation.

Mann indicated that while he favors a pause, he also wants the option of resuming the project to remain open.

"We need to respect whatever exposure is there. I don't want to give the money back if we're going to turn around and continue the project," Mann said.

They also wanted to debate what numbers should and shouldn't count.

For example, Flynn said the value of the utility improvements already made should be credited against the cost of stopping the project.

"I probably have more questions today than I have in the past," Flynn said.

Flynn left open the possibility that he would vote to allow the project to continue if the city could reduce or eliminate the subsidy required to operate the streetcar through the city’s operating budget. Deatrick and Eriksen estimated those costs to be between $2.7 million and $3.6 million after fare revenue is included.

"That's the great unknown," Flynn said. "If the operating costs are still going to cost the city $140 million over 35 years without an identified source … I've got a big problem with going forward with this."

Incumbent council members who were re-elected blasted the idea of stopping work temporarily.

"At this point, in makes zero sense to pause or cancel this project," said Councilman Chris Seelbach.

"Who are we but for our promises?" asked Councilwoman Yvette Simpson. "What do we say to people who came and believed that this city was ready to move forward?"

"We not only get known not only as the city that can't do the big project … our reputation becomes the city that will wine you and dine you and make a proposal and then leave you at the altar," said Councilman Wendell Young. "That, to me, is also not the kind of city I want to live in."